The year 2024 is undoubtedly a disappointing year for Ethereum (ETH). Although Ethereum continues to hold an important position in the blockchain ecosystem, the price of its native token ETH has consistently failed to break through the market's expected highs, and the overall sluggish performance of the Ethereum ecosystem has troubled investors. With the rise of competitors, Matrixport analysts warn: Ethereum will face greater challenges in 2025, making significant price increases for ETH less likely.
Internal and external pressures: weak ecosystem and intense competition
Matrixport points out that since Ethereum completed its upgrade last April, although Gas fees have decreased, this has not significantly enhanced the activity level of the Ethereum ecosystem, which has instead made the market feel weak. The continued low trading volume makes it difficult for ETH prices to break through higher levels. If Ethereum wants to achieve a breakthrough in the coming time, it may face significant resistance.
More troubling is the increasing competitive pressure faced by Ethereum. Emerging blockchain protocols like Solana and Sui are rapidly rising, attracting a large influx of developers and users. The performance of these protocols' tokens over the past year has significantly outperformed ETH, undoubtedly adding more uncertainty to Ethereum's future.
Matrixport emphasizes that if Ethereum cannot timely release attractive positive news, it may continue to be at a competitive disadvantage by 2025, while other competing projects may further expand their market share.
ETH positioning is vague, traditional financial markets lack resonance
In addition to the weak ecosystem and competitive pressure, Matrixport also points out that Ethereum's appeal in the traditional financial market is problematic. Although Ethereum's spot ETF has been listed, the inflow of market funds is far below expectations. The reason is the lack of a clear 'narrative' to attract investors, and Ethereum's application scenarios have not clearly conveyed to the mainstream market.
In contrast, Bitcoin has already established a foothold in the traditional financial market as 'digital gold', even gaining more recognition within the U.S. Congress. Republican Senator Cynthia Lummis from Wyoming proposed a Bitcoin bill, suggesting that Bitcoin be included in the U.S. strategic reserve assets, providing strong market support for Bitcoin.
The outlook is uncertain, how can ETH break through?
Matrixport points out that by 2025, Ethereum ETF issuers may need to take on more responsibilities to help reshape a more attractive market narrative for Ethereum, allowing investors to see its potential in technology and application layers. However, Matrixport also warns that without significant external support and market positioning, it will be difficult for Ethereum to catch up with Bitcoin solely relying on its own efforts.
For investors, Ethereum in 2025 will be a test, requiring close attention to changes in the Ethereum ecosystem and the global market's perception of it. If Ethereum can successfully shape new application scenarios and break through its current limitations, it still has the potential for greater gains in the future.
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